THIS ISSUE'S HEADLINES

Danger Lurks with Incentive-Based Sales Strategies for Health IT Platforms

Solutions For Reducing Challenges In Family-Owned Businesses

The Question of Dual (Dueling) Homesteads


Stay Informed – PLDO COVID-19 Resource Library



DANGER LURKS WITH INCENTIVE-BASED SALES STRATEGIES FOR
HEALTH IT PLATFORMS


A wise person learns from the mistakes of others. Recently, the health IT industry was afforded such a learning opportunity by a well-known EHR platform. athenahealth, Inc. (Athena), an industry-leading EHR vendor, agreed to pay $18.25 million to resolve allegations that it violated the False Claims Act by paying illegal kickbacks to generate sales of its EHR product, athenaClinicals.

In its decision, the United States Department of Justice (DOJ) alleged that Athena violated the Anti-Kickback Statute (and by extension the False Claims Act) through three Òpay-to-playÓ marketing programs. The techniques used are known as incentive-based sales strategies and highlight the danger these strategies can cause to health IT platforms if deployed.

In his latest advisory, PLDO Partner Joel K. Goloskie takes a deep dive into the DOJÕs allegations and why health IT platformsÕ greatest legal threat comes from their sales arrangements and not necessarily HIPAA compliance. Attorney GoloskieÕs article, Danger Lurks with Incentive-Based Sales Strategies for Health IT Platforms, also describes how incentives might be structured to meet the Discount Safe Harbor to the Anti-Kickback Statute and explains that incorporating incentive-based sales techniques in marketing plans are not only causes for concern to the corporation but also for individuals engaging in or permitting kickbacks.

In this complex area of the law, it is important to have experienced legal counsel provide guidance and advice. To read the advisory click here, and to learn more about permissible incentive models under the Anti-Kickback Statute, please contact PLDO Partner Joel K. Goloskie at 866-353-3310 or email jgoloskie@pldolaw.com.

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SOLUTIONS FOR REDUCING CHALLENGES IN FAMILY-OWNED BUSINESSES

The family-owned business is often assessed as a difficult structure to move from one generation to the next, and at times, may even be referred to as a breeding ground for political maneuvering and dissension. Notwithstanding, there are more success stories than failures when a new generation takes over a multi-generational business. The ones that succeed were developed with a sound structure.

Family-owned businesses represent an estimated 85% of the worldÕs companies, which means that ensuring their longevity is essential to our economy. According to the advocacy group Family Enterprise USA, there are more than 5.5 million family business operations in the United States, employing almost 62% of the workforce. As important as public companies are to the economy, these numbers prove that family-owned businesses have a significant impact on the economy and society as well.

The owners of family businesses are the decision- makers and without their approval there is no investment in resources or manpower. Contrast this structure to that of a public company in which the investors are the owners while decisions are made by a board of directors or officers. In the public setting, the board and management operate the business and make major decisions while the investorsÕ remedy for failure is to vote for change. Ownership of a family business rests with a relatively small number of related people. Their ability to shape the company is significant and for the most part, dependent upon the relationship by and among the owners, which can also lead to daily highs and lows daily.

To help family-owned business owners gain a clear understanding of the challenges facing their companies and how best to reduce day-to-day risk and plan for the future, PLDO Managing Principal Gary R. Pannone provides information in his advisory, Solutions For Reducing Challenges In Family-Owned Businesses, including offering key principles involved in operating the business, how effective communication is critical to building trusted relationships, who the decision-makers are and why the process of decision-making is important, and why having a formal continuity plan in place to execute a successful transition from one generation to the next is vital. You can access the advisory here, and if you would like to learn more or have questions about your family-owned business, please contact PLDO Managing Principal Gary R. Pannone at 401-824-5100 or email gpannone@pldolaw.com.

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THE QUESTION OF DUAL (DUELING) HOMESTEADS

As domestic migration to Florida continues to increase with more businesses and individuals choosing to relocate to the Sunshine state, an important question arises regarding oneÕs homestead entitlements.

Florida has some of the most liberal homestead exemptions from an asset protection standpoint, and a generous cap on annual property tax assessment increases. However, when a person has two or more residences Ð how does the law recognize which one is ÒhomeÓ for homestead purposes?

To qualify for the homestead exemption contained in FloridaÕs Constitution and Fla. Stat. ¤196.031, one must be a permanent resident, own or occupy the home as a permanent resident and hold legal or equitable title to the property. There are many nuances in application of the homestead exemption depending on how title is held, and the question of proper titling of the asset should be considered at the time of acquisition.

Article 7, ¤6 of the Florida Constitution allows this exemption to every person who has legal or equitable title, but limits any individual or family unit to one exemption. The law begs the question what if one spouse owns the Florida property and the other spouse owns property in a different jurisdiction (say Rhode Island, for instance) - can each property be considered ÒhomesteadÓ and receive the entitlements and advantages that arise due to that status?

Florida courts have narrowly allowed separate homesteads for spouses when each spouse has and maintains a separate residence; the spouses are not financially connected; and neither spouse provides the other with income or support. This is a high bar from an evidentiary perspective. The better option may be when an individual otherwise qualifies to file for homestead in Florida to consult with his or her attorney and determine which state provides the better homestead benefits, and claim only in that state. Filing for homestead when one is not entitled to do so can result in a retroactive denial of benefits and a lien on the real property.

The deadline for filing for the homestead exemption is March 1, 2021, although applications are taken year-round. Many counties in Florida have convenient online homestead applications, but other counties require an in-person visit. Generally, the following documents are needed: Florida DriverÕs License or Florida ID, Florida car registration, and Florida VoterÕs ID. Your driverÕs license and car registration should reflect the homestead address. Once granted, the exemption will generally be renewed each year, as long as the property continues to qualify as your homestead. If you would like assistance with filing an exemption or have questions about FloridaÕs homestead exemption, please contact PLDO Attorney Leah A. Foertsch in our Boca Raton office at 561-362-2030 or email lfoertsch@pldolaw.com.

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STAY INFORMED – PLDO COVID-19 RESOURCE LIBRARY

PLDOÕs team of attorneys continue to add updates and advisories regarding the pandemic and its impact on families, businesses and organizations that are accessible in our online Resource Library. Among the featured articles include the following:

If you have questions and would like further information, please contact your PLDO attorney directly in our Rhode Island, Massachusetts or Florida offices or call our toll free number at 866-353-3310 to discuss your legal matter. We are here to help.

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